If you’ve decided to offload your company, there are number of things you can do to improve its image in the eyes of potential suitors.
By going through it department by department, there are many areas that you can improve that will increase the sales price that you end up receiving.
Want to attract the attention of firms such as Generational Equity? If so, here are a few tips that you can use to improve the sellability of your company.
1) Go through every aspect of your business with a checklist
There are a number of areas that business buyers will evaluate when they are attempting to figure out whether a certain company is worth purchasing.
From your legal standing in the marketplace, to the quality of your products, they will go over your business with a fine-tooth comb. In keeping with this approach, you will need to treat every department with the same attention to detail.
Many deficiencies that are caught by seasoned business purchasers will negatively impact the price that they will offer you, so be sure to not overlook anything that could reflect badly on your company’s image.
If you don’t have a system in place to evaluate the functionality of your business, answering the following questions will help you start the fine-tuning you’ll need to do before courting buyers:
Are all your professional licenses up to date? Do you have consistent revenues, profits, and positive cash flow? Is your website user-friendly? Do you have systems in place that would help the buyer run your company with turn-key functionality? Are your products distinct from your competition? Do you have a reliable base of customers or clients?
These are just a few of the questions that will help you make your company attractive to buyers.
2) Determine what deficiencies are worth fixing
While some problems will need to be fixed before you can move forward with selling your business, others won’t impact the sales price enough to make them worth worrying about.
If the area under examination doesn’t play a key role in the core success of your business, if the cost of improving the area costs more than it would impact the sales price, or if it would take too long to fix relative to the time frame of the planned sale … then don’t worry about it.
You need to focus your efforts on high impact areas, and many deficiencies do not fall into this category.
3) Draw up your improvement plan
Once you have decided on the areas that you will be focusing on, create a plan so you that all efforts can be executed in an efficient manner.
Break down the necessary steps to improve each deficiency, the amount of time that it will take to complete, the resources necessary for all tasks, and the employees that will be responsible for executing each part of the plan.
By putting these details down in writing, you’ll have a master document that will make necessary changes easier to implement.
4) Keep your intentions to sell as private as possible
While there are people that you will need to divulge your sale plans before announcing them, it is vital that you disguise your pre-sale preparation efforts as something else (e.g. a company improvement exercise).
If word gets out that you are planning to sell the company, it can have a negative impact on its sale price, as well as productivity and revenues in the interim.